Using Retirement Funds to Finance a New Business

Statistics show that more than one million people in the United States
start a new business each year. That number would be much higher if all
the would-be entrepreneurs had the financing required to get a business
up and running. In order to accomplish their dream of business ownership,
entrepreneurs are finding new and innovative ways to finance their new
ventures.

According to Leonard Fischer, President/CEO of BeneTrends, one of these
new financing options is the use of a person's existing retirement funds-a
pension, profit sharing, 401(k), IRA-which allows that person to start
the business he or she has always dreamed of without tax penalties, consequences
or mountains of debt.

Under the Employment Retirement Income Security Act (ERISA), retirement
funds can be transferred into usable capital for business investments
or operations. If a person has more than $40,000 in a retirement account
and is not currently employed by the company that holds those funds, he
or she qualifies for this Small Business Administration (SBA)-recognized
financing approach to start a business.

Retirement funds can be used for any business purpose, including:

 Purchasing a franchise or existing business

 Start-up expenses, such as purchasing property, equipment, etc.

 Working capital, including paying salaries, franchise fees, etc.

 Business expansion, such as funding additional franchises, locations,
etc.

 Equity toward SBA or other loans.

The thought of dipping into one's retirement can cause some apprehension.
Through this investment strategy an individual actually has more control
over his/her retirement-instead of gaining minimal growth dependent on
the stock market, those savings are actually being invested in one's own
business. This approach often allows an individual to set aside more money
for retirement than ever before.

"Today's entrepreneur faces an environment of tremendous competition,
complexity and opportunity, so starting a business the right way is more
important than ever," says Dr. Germain Boer, Director of Vanderbilt
University's Center for Entrepreneurship. "This financing method
is a good option for an individual who has accumulated funds in his/her
retirement accounts."

The entire process generally takes two to four weeks to be completed,
and can be done by phone, email, fax, FedEx and regular mail.

Working with an experienced employee benefits plan expert, starting a
business is as simple as these four steps:

Step 1: Establish a C-corporation.

Step 2: The new corporation creates a retirement plan.

Step 3: Funds are rolled over into the corporation's new retirement plan.

Step 4: The new retirement plan purchases the stock of the corporation.

"So many people have watched their dream of owning their own business
go out the window due to lack of funding options. We help people achieve
that dream every day using money they already have," says Fischer.

If you're ready to explore this innovative financing option, be sure
to consult an expert to guide you through the specialized process. For
more information on how you can begin investing in your own future, visit
www.benetrends.com.